AUTOMATION IS NOT ALWAYS THE ANSWER

I keep hearing that automation is the answer to increasing productivity, especially in unionized environments where increases in wages and benefits do not result in increased productivity.  In some cases, General Motors comes to mind, the unions have taken over the company and it now appears to be a union pension fund with a vehicle manufacturer attached instead of a vehicle manufacturer with a union pension fund attached.

But in spite of union resistance to automation and change, we are finding more and more executives who believe that automation, be it expert systems that reduce the need for specialized and costly employees or the use of robotics to eliminate the employee altogether, is crucial for their continued continuity and survival. 

Am I Next? Automation. Job Loss.

Unfortunately, there are the darker sides of automation. The build-up of additional machine capacity that may sit idly by until orders arrive. Or the company is forced to operate an internal job shop to ease some of the cost burdens and meet payback schedules.

But, how many people consider that automation can form a negative feedback loop -- where more supply chasing less demand leads to lower prices, margins, and profits. Until the final stage of commoditization which can only be met by subtracting labor from the production costs.

Keep your eyes open for how automation might affect your industry, your company, your department, and your job.